California Apparel News

Active Ride, the embattled chain of surf/skate stores, has filed a voluntary petition for Chapter 11 reorganization in U.S. Bankruptcy Court in Riverside, Calif. The Mira Loma, Calif.–based retailer closed eight of its 24 locations in March and has racked up nearly $9 million in debt to its vendors, which include Hurley, Quiksilver, Nike, Sole Technology, Ezekiel, Matix Clothing, DC Shoe and Stuuml;ssy.

Under bankruptcy protection, Shane Wallace, co-founder of the retailer, hopes to reorganize Active with a smaller store base of 21 retail locations and its online storefront. Wallace offered no details on how the bankruptcy filing would affect his vendors. “We are working with vendors in several different ways. The goal is to add health to an unhealthy market as soon as possible,” he said.

Prior to the store closures, which eliminated approximately 50 jobs from Active’s roster, the retailer made cuts in an attempt to stem its expenditures. Wallace said corporate staff has been cut by about 25 percent since fall 2008, leaving the retailer with approximately 50 employees working at its corporate offices. Marketing budgets and other expenditures were also reduced, he said. According to a statement from the company, the store closures and corporate work force reductions will reduce expenses by more than 30 percent.

Wallace told California Apparel News that no more store closures were expected. This contradicts statements he made to other media, in which he said up to three other stores were being considered for closure. Wallace did not return calls for clarification.

Wallace blamed the chain’s difficulties on the economy. “Nothing particularly ’floundered’ except the downturn in the economy,” he said. In a statement, his father and company co-founder, John Wallace, said a “perfect storm of economic retraction” left the retailer with no other option but bankruptcy.

“The next several months will call for stabilization, and the future will call for growth. In principle, I believe that Active is the best retail platform in the marketplace,” Shane Wallace said. “In the past several months, [Surf Industry Manufacturers Association] voted Active as the best men’s retailer in the market and DNR named Active as one of the top 50 most influential retailers in America. Today, the same team that earned those honors is still in place, and we are much better than we were one year ago.” —Erin Barajas